Quiet start for Gullivers listing

New Zealand's first listed travel company has joined the stock exchange, although investor reaction to Gullivers Travel Group was not overwhelming, with the share price falling on its first day of trading.

Gullivers' recent $104 million initial public offering (IPO) is the third-largest in New Zealand this year.

Its shares, which at one stage rose to $1.65, closed down 1c on the listed price, finishing at $1.59 each.

Under the leadership of founder and managing director Andrew Bagnall, Gullivers has become one of the biggest travel wholesalers and retailers in New Zealand, surviving in what has been an often cut-throat business.

Only Feltex's $243 million raising and CanWest's $104.04 million have raised more money on the New Zealand Stock Exchange this year.

Brokers UBS, which organised the float for Gullivers, were in the market yesterday, buying shares to support the price on its first day of trading.

Stock exchange chief executive Mark Weldon told a small function in Auckland yesterday that in the same way immigration had been the "secret engine driver" of the US economy, travel and tourism were doing the same in New Zealand.

Gullivers was a quality company that allowed investors to "buy exposure" to this sector of the economy.

Bagnall said the listing began "an extraordinary new era", before thanking those who had helped the business during the past 30 years.

The company had now moved away from being the creation of one entrepreneur, to one that had the capital to "go forth into the world". Others could share in the success of the business, which was now in a real position to expand.

With the new capital raised through the float, Gullivers is debt-free. Its latest venture is running the New Zealand wing of the Zuji internet travel portal.

Bagnall said he was looking forward to the new credibility that came with being a listed company - credibility that he, as a private entrepreneur, could never have achieved in Europe or the US.

"Thank you for your confidence. We won't let you down."

One broker said the soft first few hours of listing had been "a gentle reminder to the investing public that new issues are not always the road the riches".

Floating along

* Ownership: new investors, 64.2 per cent; founder Andrew Bagnall, 28.8 per cent.

* Total raised in float: $104 million.

* Listing price: $1.60.

* Closing price: $1.59.

* Day one market capitalisation: $159 million.

* Bagnall's stake worth: $45.8 million.